Light shed on Rush's role in Metra scandal

By Jeff Coen, Stacy St. Clair and David Heinzmann, Chicago Tribune reporters

After pressuring a Metra contractor to hire more African-American companies for a crucial South Side rail project, U.S. Rep. Bobby Rush recommended that the commuter rail agency pay $50,000 to a little-known Washington, D.C., group to monitor minority participation.

Yet several key players who negotiated to increase the number of black businesses involved in the Englewood Flyover project told the Tribune this week that they were unaware of the Washington organization's suggested role — or the attempt to get them money — before Metra's ex-CEO alleged he was improperly pressured to approve the no-bid proposal.

"I'd never heard of the D.C. group prior to now," said Michael Stuttley, a former Cook County judge who along with two other Rush allies formed an ad hoc committee that helped broker a nonbinding jobs agreement in July 2012.

But there were hints of a broader relationship between Rush and the National Black Chamber of Commerce before those negotiations ended. Two weeks before the agreement was signed, the chamber announced a partnership with the congressman to ensure minority participation in "every major infrastructure project within the greater Chicago region."

That partnership never materialized, and neither did the chamber's monitoring role on the rail project. After Metra officials refused to pay the $50,000 fee, the proposed side deal for the group died and the efforts to get more work for black-owned businesses faded.

The curious maneuverings remained hidden in the background of the massive flyover project until Metra CEO Alex Clifford complained at a recent public hearing into the $718,000, no-tell severance package he received after threatening a whistle-blower lawsuit against Metra that he was pressured to send the chamber a check.

Clifford's allegations stoked a scandal that has led to three Metra board resignations and state ethics investigations centered on his attention-grabbing claims that his job was threatened because he refused Illinois House Speaker Michael Madigan requests to award a pay raise to a Madigan political supporter. Madigan has acknowledged seeking the favor for his foot soldier, though both he and top Metra board members reject Clifford's claims that there was any political pressure.

The circumstances surrounding Rush's involvement in the previously unknown $50,000 monitoring deal have been less clear.

In a statement last week and a brief interview with the Tribune, the congressman acknowledged he recommended that the National Black Chamber of Commerce in Washington be hired.

Rush spokeswoman Debra Johnson initially denied that the congressman asked for the chamber to receive any money. In a subsequent interview, she told the Tribune that Metra had agreed to pay for a liaison to work with black contractors.

But Tribune interviews with participants and a review of documents related to the project — including the controversial memorandum of understanding aimed at boosting minority contracts — conflict with Rush's version of events. All three members of an ad hoc committee formed to boost minority participation on the project said they never agreed that the group should be the monitor and did not suggest that Metra fund it.

Henry English, who runs a South Side community organization called the Black United Fund of Illinois, said the group never discussed who should monitor the agreement, nor did the group lay out any ground rules or recommendations for how the work should be done.

"That was the only thing I was committed to — to work through some kind of agreement," English said. "Once we finished that, we felt our role was through."

Approached after a public event last week and asked whether he or his staff ever told Metra to send a $50,000 check to the National Black Chamber of Commerce, Rush said "it was only a recommendation."

Asked about Clifford's claim that he was politically pressured to cut a check to the group, Rush said, "He got it wrong. It was totally harmonious."

The congressman said he was simply trying get more project money for black contractors and he wanted to use the National Black Chamber of Commerce because it is well-respected.

"Because they are pre-eminent in the world at this kind of monitoring," he said. "They were not locally based, and it was only a recommendation."

The $141 million bridge project, funded by federal stimulus money, was designed to untangle the country's worst freight and commuter railroad bottleneck, located in the impoverished Englewood neighborhood.

But it was slowed by a vociferous and well-publicized campaign launched by Rush and other African-American public officials and community leaders angered that the project — while meeting federal requirements for giving minorities a share of the government contracts — would bring few if any jobs to blacks living there.

Their protests were supported by acting Metra Chairman Larry Huggins, the owner of a prominent construction company that has won minority contracts on big projects in the city and Cook County.

Metra already had paid more than $200,000 to the Target Group consulting firm, owned by longtime Huggins business associate Joe Williams, to help recruit minority bidders.

In the face of the protests, Huggins delayed a board vote on the contract with the project's main contractor, Elgin-based IHC Construction Cos., while company officials negotiated with civic leaders on ways to give black-owned businesses a bigger cut of the project's funding.

Those discussions occasionally grew tense, including one instance in which committee member Hal Baskin, a former street gang member turned community organizer, referred to violence that could befall the contractor if more jobs didn't materialize.

"We were talking, and I said, 'Look you're in the black community. There's a lot of violence going on in the Englewood community. … In order to reduce the violence, you've got to put people to work,'" said Baskin, a longtime Englewood activist. "'Right now they're shooting each other, so they wouldn't have a problem shooting at people coming in and doing work who aren't from the community.'"

Baskin said his comments were not intended as a threat and that IHC President David Rock "understood where I was coming from."

Rock did not respond to calls for comment.

The negotiations worried some officials at the rail agency, who questioned whether such a side deal was even legal under federal bidding laws, said Metra board member Jack Schaffer, of McHenry County.

"These were more than thinly veiled threats. These were real threats," Schaffer said. "There was concern from Metra's legal department that all these off-site negotiations could come back and haunt us."

In the end, IHC agreed to give black construction companies the opportunity to bid on millions of dollars in project work beyond the 25 percent already promised to other minority-owned companies under federal contracting rules.

Both IHC and the committee members signed the memorandum of understanding at a morning breakfast meeting on July 16, 2012. At a special Metra board meeting hours later, Huggins praised the agreement and said it was time to vote on the company's $93 million bid to build the bridge near 63rd and State streets.

It passed unanimously.

The actual memorandum language was not made public despite a heavily publicized signing and news conference about it organized by Rush's office. Schaffer said it was not distributed to Metra board members and that he still has not seen it.

A copy of the document obtained by the Tribune, however, shows that IHC and the community negotiators agreed to name a "community liaison" to monitor progress on the agreement.

It was against that backdrop that Rush suggested the National Black Chamber of Commerce get involved.

Clifford said the first time he heard of the group was when Huggins told him Metra should pay for monitoring the terms of the memorandum.

Huggins said Rush's office would tell Clifford where to send a check for $50,000, according to the former CEO's account. And the congressman's office did send him an email telling Metra to send the check to the group, Clifford said.

"And I said I can't do that," Clifford told the Regional Transportation Authority at a special hearing last month.

While Clifford had the authority as CEO to cut checks for $50,000 or less without board approval, he said he balked at Huggins' suggestion that he do that. Clifford said he had no way to hold the organization accountable and would agree only if the board approved the payment.

Huggins wanted Clifford to say the that NBCC payment was recommended by Metra staff, Clifford alleged. But Clifford considered that notion unethical and said the payment proposal was dropped when Huggins refused to have his name attached to it.

Huggins, who has called Clifford's allegations "totally false," did not respond to calls for comment on this story.

"Larry was very upset that Alex wouldn't do exactly what he wanted," Schaffer said. "But Alex was right. Why would we give $50,000 to a group we've never heard of and that wasn't even locally based?"

The chamber's president, Harry Alford, said via email this week that his group's role was more tenuous than what has been discussed publicly in the wake of Clifford's remarks.

"We 'kicked it around' about a year ago. I told him we have developed a program that works — no PR but actual development of minority firms on a specific project," Alford said of Rush. "I believe I left it with the congressman that whenever he wanted to see what we could do, we will be there for him via training local talent to perform the monitoring and screening. No specifics or formal negotiation/presentation ever occurred."

Asked how he knows Rush, Alford said he has been an admirer since the late 1960s, that he sees Rush on Capitol Hill and that he has testified before the House Committee on Energy and Commerce, of which Rush is a member.

Alford and his wife, Kay DeBow Alford, formed the NBCC in 1993, according to public records.

In the mid-1990s, Alford was part of a federal civil rights lawsuit against Indiana, alleging a conspiracy by the state to award minority business certification to "sham" contractors that were fronts for white-owned firms. But the plaintiffs' efforts to present Alford, a former state employee, as an expert witness on minority contracts were rebuffed. A federal judge dismissed the case.

Shortly before the Metra side deal was signed, Alford's organization announced that it had agreed with Rush to take on a broader role for construction projects around Chicago.

"This partnership is to monitor and ensure that every major infrastructure project within the greater Chicago region involves significant procurement activity from the database of black architects, engineers, construction managers, general contractors and subcontractors," said the announcement on the group's website.

Alford called it a concept that never was executed.

Asked about the proposal for $50,000, Alford said, "We do not charge for our services but do incur costs for software and verification of minority business status and actual participation. Our software and verification firm charges a flat fee to us for $50,000."

The amount raised eyebrows in part because such monitoring jobs rarely cost that much, according to Schaffer and another contract consultant.

"I've never seen $50,000 for monitoring," said Mary Kay Minaghan, a minority contract expert and the legislative consultant for the Women Construction Owners & Executives caucus in Chicago. "Metra would never agree to pay that much."

Clifford's refusal to cut the check appeared to stop the memorandum in its tracks. Metra officials insisted they had neither the desire nor the legal standing to enforce the deal.

Rush publicly bragged as recently as last week that the negotiations resulted in more work for black-owned construction companies, but his spokeswoman confirmed Wednesday that the congressman's office does not know if the memorandum created additional jobs.

"This is between Metra and the contractor," Johnson said. "It's not our responsibility. I don't understand why you think it is."